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This article explains how to write a business case. It includes 2 business case examples and a free business case template for you to download .+44 (0)207 148 5985

You’re probably reading this article because you want to know how to write a business case. Perhaps your organisation is embarking on a major project to develop a new product. Or, perhaps you’re thinking of moving house so your family can enjoy a better life. In either case, you write a business caseOr chat with us using the link at the bottom of the screen. to ensure the investment is worthwhile.Contact us with questions about the courses on this page, or about which project management certification or training is best for you.

In this article we’ll give you 2 business case examples, provide you with a simple business case template for you to use, and explain how to write a business case.Finance FAQs

What is a business case?®

A business case is the justification for some activity (e.g. a project) undertaken by your organisation. It weighs up the timescales, costs and risks of doing the activity against the benefits to be gained. Think of it as weighing up the pros and cons and then taking a sensible decision., MSP

A business case forms an essential component of the curriculum of the ®best project management courses, ITIL.®

Personal business case, P3O

You may also use a business case to justify an investment you make in your personal life. For example, when you’re thinking of moving home to another area. You and your spouse will need to understand the costs of moving, the timescales and risks involved, and weigh these up against the benefits to be gained e.g. saving time traveling to your office, or your children able to go to a better school.®

Why have a business case?, PRINCE2

Projects should not just start on a whim or because of vanity – although a lot of money has been wasted over the years on such ®projects Agile, RESILIA.®

For business organisations, justification for a project usually takes a commercial form i.e. evaluating how much money could be made from the investment. For example, investing money in developing a new software app to bring first to market, might be deemed to bring certain monetary benefits (in terms of sales) which exceeds the costs of investment., and the Swirl logo are registered trademarks of the PeopleCert group. Used under licence from PeopleCert. All rights reserved. AgilePM

For government organisations, justification is probably not a commercial one, but could be based upon giving value for money to achieve certain benefits. For example, a public health campaign extolling the benefits of flu-vaccinations for elderly people, might be judged as giving greater value for money than having no campaign, and instead relying on treating patients in hospital once they have contracted the virus.®

With so many competing claims being made on scarce funds, organisations need the assurance that the decision they are taking is the right one. After all, there will not be enough funds to pay for all the ideas for projects which are floating around the organisation. and AgileBA

Who uses a business case?®

Business cases can be used by many different levels of management within an organisation. Not only are they used to justify the investment in an individual project, but also they are typically used by a are registered trademarks of Agile Business Consortium Limited. All rights reserved. The APMG International AgilePM and Swirl Device logo, APMG International AgileBA and Swirl Device Logo, APMG International Change Management and APMG International Better Business Cases and Swirl Device logo are trademarks of The APM Group Limited, used under permission of The APM Group Limited. All rights reserved. Better Business Cases™ is a trademark of Her Majesty’s Treasury. All rights reserved. DevOps Foundationportfolio management® office to help it decide which projects will contribute to the organisation’s strategic goals. That way, they can filter out the bad ideas for projects, and only fund projects which will contribute to strategic goals. is a registered mark of the DevOps Institute. “PMI”, “PMBOK

A business case is also often used by a project sponsor or project executive to help it decide if they should invest in a specific project.®

In all cases, the business case must be written and approved prior to any major commitment of resources. Guide”, “PMP” and “CAPM” are registered marks of Project Management Institute, Inc. Knowledge Train Scrum Essentials™, Business Learning Library (BLL)™, Business Analysis Learning Library (BALL)™, Agile Learning Library (ALL)™, IT Learning Library (ITLL)™, and Compliance Learning Library (CLL)™ are trademarks of Knowledge Train Limited. All rights reserved.

What form does a business case take?Knowledge Train Ltd is an Introducer Appointed Representative of NewDay Cards Ltd for the Newpay finance product provided by NewDay Ltd. NewDay Cards Ltd acts as a credit broker, not a lender. We will introduce you exclusively to Newpay finance products provided by NewDay Limited under this Introducer Appointed Representative arrangement. Finance available from other lenders is not covered by this arrangement. NewDay Ltd and Newday Cards Ltd are authorised and regulated by the Financial Conduct Authority (ref nos 690292 and 682417 respectively).

Business cases can take many forms – digital or analogue. The tools you use to create one are also many and varied. Common business tools such as Microsoft Office might be used. Rather than being a document or slide deck however, it could equally be in the form of an email.

Equally, a business case could be written by hand on a whiteboard or flipchart, or on the back of a cigarette packet!

What you should always remember is that a business case does not have to be a huge long document. In fact, it should be as short as possible, and only include the most important information. That way it cuts out the noise and provides decision-makers with just the right information to enable them to take sensible decisions.

For those of you interested in project management , the project management methodology known as SearchPRINCE2 focuses its decision-making on a project on having a viable business case.

Business case examples

We will now give you 2 business case examples. The first example is one which you might find useful for taking decisions in your personal life. The 2nd business case example is more business focused project.

Business case example 1: Moving home

Suppose you and your spouse are considering moving to a new home. You will need to weigh up the pros and cons of moving. This is done using a business case. You might not call it that, but that’s what it is. Let’s look at an example.

Reason

As you can see from the example, the first thing to be clear about in a business case is the reason for doing the project or activity. In this example, the couple has answered the question Why? In fact, there are two problems here – the local school and John’s long commute.Request a quote

Options considered

A business case should weigh up the competing options which have been considered. After all, there is usually more than one option. Perhaps an alternative option would have been for John to change his job to one nearer their current house. However, this wouldn’t solve the issue with the school.

Benefits

The benefits of a project or activity are the positive things you’re going to get back in return for your investment of time and money. In this case, the kids will get a better education, and John will save time each day.

Timescales

It’s also important to understand how long the investment of resources will take. This is so that the organisation (or family in this case) knows when the resources will be freed up to work on other projects or activities.Manage Consent

There are usually 2 timescales to consider. First, the timescale of the project or activity – in this case 3 months to find a new house and move there. Second, the time over which the benefits shall be realized. In this case it’s 5 years until the kids leave school.

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The costs of doing the project or activity is the next important bit of information. On this project, the costs of moving to a new house will be £5,000. These are the project costs.

However, the couple will spend an additional £2,000/year for every year over which the business case is calculated. For a project in an organisation, this is usually referred to as the operational costs of maintaining and operating the projects outputs e.g. an IT system. At this point, the couple knows the total costs over the timescales when the benefits shall be realized.

Risks

For any activity or project, it’s also important to understand the major risks involved. Risks are the uncertain things which may or may not happen during the period of the investment. There is only one risk identified here, which is the risk that the couple might lose touch with friends who live close to them right now.

Investment appraisalFunctional

The next section is where the costs and timescales and risks are weighed up. For this project, it’s a simple decision for the couple to decide if it’s worth spending money over the next 5 years to give their kids better schooling and to save John 2 hours a day commuting.

For an organisation to decide if an investment is worthwhile, however, there are several different ways in which it can decide about the investment.

Often in organisations there are rules defined to help business analysts or project managers write what’s called an investment appraisal. In the next example, we’ll look at one example known as net benefits.Functional

Business case example 2: Handheld device project

Imagine a heating repair services company that uses a paper-based set of forms filled in by an engineer during site visits. The spare parts required to fix the heater are recorded on a form which is given to staff to process back in the office. They then order the parts, and schedule a follow-up visit for the engineer to fix the heater. Always active

Costs

MarketingThe final section is the investment appraisal. The investment technique used in this example is called net benefits. As you can see from the table, the project and operational costs are recorded for each year of the investment.

The project lasts 1 year which is why the project costs are zero after year 1. Of course, the benefits won’t be realized until the solution is in place and the company starts to use the handheld devices.

The net benefits are simply the total benefits minus the total costs. This shows that the company will start to get a return on its investment sometime towards the end of year 2. This knowledge is vital if the decision-makers are to take a sensible decision about whether to invest in the project.

Business case template

This simple Marketingbusiness case template is free to download.

Summary

A business case is the most important document on any project. That’s because it justifies the investment.

It helps an organisation be clear about why a project is needed, and what the results of the investment will be. This is crucial because no organisation has unlimited funds to spend on an unlimited number of projects. Therefore, a business case gives confidence to senior managers when deciding to invest in one project rather than another.

However, as you have seen in this article, a business case is something which you can find useful when taking major decisions in your own personal life. Remember – a business case doesn’t need to be a lengthy document. It could easily be a few notes scribbled on the back of something or even sent in an email.

Whatever form your business case takes, remember one thing – it will help you or your organisation take sensible decisions about committing time and resources to a project or activity.

Remember, if you want to learn more about developing a business case, and learn many of the techniques useful for assessing business problems, consider attending a classroom The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.business analyst course .Manage options

Business case FAQs

Who approves a business case?

Usually on a project, the project sponsor (the person or people who are committing the funds) will approve a business case. Before approving it, they need to have confidence that the problems have been addressed and the right solution has been selected, that the benefits are achievable and realistic, when the investment will pay off, and how big will the return on investment be.Functional

What makes a good business case?

As you have seen in this article, there’s several important bits of information which goes into a business case. Don’t spend unnecessary time though adding information which isn’t required. Your project sponsor will have to read your business case before they approve it, and you don’t want to make their job any harder than it already is! Always active

There are several things you can use to check whether your business case is adequate or not. Here’s a checklist of 13 questions to ask yourself before you submit your business case to your sponsor for approval:

1. Are the reasons for the project consistent with the corporate, portfolio or programme management strategies?
2. Is the The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.project plan aligned with the business case? (e.g. are the costs and timescales in the project plan correctly reflected in the business case?)
3. Are the benefits clearly identified and justified?
4. Is it clear how the benefits will be realized?
5. Is it clearly defined what will judged a successful outcome?Preferences
6. Is the preferred business option clearly stated, along with the reasons why?
7. If the project requires external procurement, is the preferred sourcing option stated, and why?
8. Is it clearly stated how any necessary funding will be obtained?
9. Does the business case include non-financial, as well as financial criteria?Preferences
10. Does the business case include operations and maintenance costs and risks?
11. Does the business case include project costs and risks?
12. Does the business case conform to organisational accounting standards (e.g. break-even analysis and cash-flow conventions)?
13. Are the major risks faced by the project explicitly stated, together with any proposed responses?

How do you write a good business case?

A good business case must contain certain key information including:

• The reasons for doing the project;
• The business options which have been considered, including the base business options of do nothing, so something, or do something else;The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
• Project and operational costs;
• Project and operational timescales;
• Benefits, expressed in measurable terms;
• Investment appraisal (or cost benefit analysis);
• Major risks and their mitigation plans;Statistics

How long is a business case?

A good business should be long enough that it contains all the information needed for the decision-makers to take an informed decision about whether to invest in the project. That means, remove any waffle, and only include information which helps decision-making.

What’s included in a business case?

The following are the most important items to put into a business case:Statistics

• Executive summary – summarizes the key points;
• The reasons for the project (answers the question ‘Why are we doing this?’);
• The options considered – e.g. do nothing, do something, or do something else – (answers the question ‘What’s the best option?’);
• The expected benefits – in measurable terms – (answers the question ‘What’s the return?’);
• Costs – both project and operational – (answers the question ‘How much will it cost?’);
• Timescales – for the project and for realizing benefits – (answers the question ‘How long will it take?’);
• Investment appraisal – weigh up costs, times, risks against benefits – (answers the question ‘Is it worth it?’);
• Major risks – (answers the question ‘What if?’).The technical storage or access that is used exclusively for statistical purposes.

What is a business case template?

A business case template serves as a starting point when writing a business case. It is reusable and can be used across all your projects. Depending upon its needs, your organisation may have different business case templates, each one used for different scales of projects.The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.

You can download an example business case template here .

What is the purpose of a business case?

The purpose of a business case is simple – it’s used to justify an investment in an activity. Typically, in an organisation this activity is a project. It helps give confidence to management that their investment is worthwhile and will realize benefits for the organisation.

Who owns a business case?Marketing

A business case is owned by the person who is funding the project. The name of this role is different across organisations, but commonly this role is known as a project sponsor, or project executive.

By owning the business case, it means this person is accountable for ensuring that any investment decisions which are taken based upon the information within the business case are worthwhile.